Saudi Press

Saudi Arabia and the world
Sunday, May 11, 2025

Is the UK a bad place for tech firms?

Is the UK a bad place for tech firms?

Microsoft is seething.
Despite months of lobbying and negotiation, the UK's competition regulator ruled yesterday that the tech firm should not complete its proposed multi-billion dollar purchase of the games maker Activision Blizzard. It would have cemented Microsoft's status as a video game uber-giant.

If the UK, US and EU don't all approve the deal, it is very unlikely to be able to go ahead.

Neither Microsoft nor Activision have pulled any punches in their responses, with the former branding the decision "bad for Britain" and the latter saying "the UK is clearly closed for business".

Are they right?

The CMA doesn't think so - it says protecting the interests of businesses in Britain is intrinsic to its ruling.

The government would also say absolutely not.

Prime Minister Rishi Sunak recently spoke of "Unicorn Kingdom" - a unicorn is a firm worth more than $1bn without being listed on the stock exchange - and talked of an ad campaign targeting Silicon Valley investors.

I received a flurry of virtual raised eyebrows from various contacts about that - but fundamentally Sunak's vision of a prosperous UK has tech at the heart of it.

The body Tech Nation - which ironically lost its government funding in January after 10 years as a UK tech sector champion - valued UK tech firms at $1trillion, collectively, at the start of the year. Only the US and China have exceeded this milestone, it said.

Britain has a long history of being good at tech innovation. Radio, the telephone, the Enigma World War 2 code-breaking machine, Dolby surround sound, the World Wide Web - all UK-based inventions.

So where, then, is our Apple, our Google, our OpenAI?

I've been to the unkindly nicknamed Silicon Roundabout tech hub in east London, and the beautifully titled Silicon Glen in Scotland.

We have a handful of big successes - look at semiconductor firm Graphcore - and plenty of much smaller ones. But we are seriously lacking Silicon-Valley scale corporations which are also household names.

The UK had a considerable asset in the Cambridge-based chip designer Arm, but it now belongs to the Japanese firm Softbank, and this year will no longer be listed on the London stock exchange.

Deepmind, the hugely successful AI firm, is still UK-based but now belongs to Google.

I've interviewed countless tech start-ups here in the UK over the years. And often, although never on the record, I'll hear a similar ambition: they hope to get bought up by a US tech giant waving a huge cheque.

Some of them manage it. Sometimes the giant in question only actually wants a small part of the firm's intellectual property and winds the rest of it down at the earliest opportunity. That is of course not unique to either tech or the UK.

Everyone has a price, as the saying goes. But also, scaling up is hard.

Numerous entrepreneurs have told me that growing a company is a fragile time, because even though it appears to be doing well - there's more scrutiny, regulation, tax rules, workers are stretched, there may not be the immediate cashflow to balance the extra work and facilities having to be bought in.

On top of that, Brexit brought about the introduction of a new layer of operational issues to be navigated by all businesses, and the long anticipated Online Safety Bill comes with strict new rules for tech firms in that space, and large penalties for non-compliance.

One investor told me that while Britain is a good place to start, it's a much harder place to scale up.

Of course to an extent the same is true worldwide. For every Meta, there are thousands, maybe even millions of failed start-ups which burned through their funding and couldn't make it work.

You do also have to remember there is simply a lot more money in the US and, rightly or wrongly, less red tape.

Lots of people I speak to genuinely believe the UK has a chance to really punch above its weight in the rapidly accelerating AI revolution.

The government has introduced fairly light regulation for AI so far - stricter than the US but less strict than Europe - in the hope of allowing businesses to thrive.

There are currently more than 3,000 AI companies in the UK with a combined revenue of $10bn in 2022, according to official figures.

One idea doing the rounds in the UK tech scene is creating a "Britbot" - a British answer to OpenAI's viral AI chatbot ChatGPT and Google's Bard.

A faintly comical name, maybe, but the idea behind it is absolutely serious: perhaps there is an opportunity here for the UK to position itself with those at the front the race?

Just don't expect Microsoft to race to invest in it.
Newsletter

Related Articles

Saudi Press
0:00
0:00
Close
Trump's Upcoming Visit to Gulf Nations: Investment and Security at the Forefront
Cardinal Robert Prevost Elected as Pope Leo XIV, Marking a Historic Papacy
India-Pakistan conflict may be first test for Chinese military tech
Bill Gates Announces Plan to Wind Down Philanthropic Foundation and Disperse Wealth
Common Sense Returns to Britain's Legal System: UK Supreme Court Declares a Woman Is… a Woman
Warren Buffett to Step Down as Berkshire CEO After Nearly 60 Years
Trump Shares AI-Generated Image of Himself as… Pope, Prompting Outrage Reaction
Amazon Launches Satellite Internet Service Amidst Competition with SpaceX
The Rush to the White Gold: Global Investment Surge in Natural Hydrogen Exploration
Trump Administration Removes National Security Adviser Mike Waltz Amid Signal Chat Controversy
Liverpool Clinches Record-Equalling 20th English League Title Under Arne Slot
Massive Explosion at Iran's Bandar Abbas Port Linked to Suspicious Chemical Shipments
Pope Francis Laid to Rest in Rome as World Leaders Attend Funeral
Not Child’s Play: How Competitive Gaming Became a Global Economic Empire
California Surpasses Japan to Become the World’s Fourth-Largest Economy
Former U.S. Congressman George Santos sentenced to eighty-seven months for wide-ranging fraud
Israel Considers Limited Strikes on Iran's Nuclear Facilities Amid Diplomatic Efforts
Saudi Arabia Offers Max Verstappen Unprecedented Deal to Join Aston Martin
Global Pistachio Shortage Amid Rising Demand for 'Dubai Chocolate'
IMF Predicts No Global Recession Amid Trade Tensions
Worldwide Markets Decline as U.S.-China Trade Frictions Intensify
OpenAI Lands Unprecedented $40 Billion Investment
Removing the Political Adversary is Dismantling What's Remaining of Turkey's Economy.
Ex-FIFA President and French Football Icon Acquitted of Corruption Allegations
White House Investigates Security Breach After Journalist Accidentally Added to Secret Yemen Strike Chat
Volunteers in Jeddah Ensure No One Goes Hungry During Ramadan Iftar
New Restaurant Opens in Makkah's Iconic Clock Tower for Ramadan Iftar
Saudi Arabia's Project Masam Removes 552 Houthi Mines in Yemen
Saudi Arabia Fines Over 400 Foreign Trucks for Regulatory Violations
Saudi National Campaign for Charitable Work Reports Significant Donations in Ramadan
Historic Al-Hosn Al-Asfal Mosque Restored in Asir as Part of National Heritage Initiative
KSrelief Expands Humanitarian Efforts in Syria, Sudan, and Lebanon
Saudi Arabia Advocates for Global Water Cooperation at Forum
Madinah Governor Tours Islamic Arts Biennale in Jeddah
Saudi Foreign Minister in Cairo to Lead Meeting on Gaza Developments
Recognition of Saudi and Pakistani Entrepreneurs at Riyadh Ceremony
UAE Announces $1.4 Trillion Investment Plan in the United States
Saudi Arabia Innovates in Soil Quality and Water Conservation
Governor of Taif Engages with Rose and Aromatic Plants Cooperative
Saudi Food and Drug Authority Enhances Preparations for Hajj Season
Saudi Arabia Distributes Aid to Yemen and Romania
Restoration of Historic Al-Qalaah Mosque in Riyadh Underlines Heritage Preservation Efforts
Saudi Arabia Arrests Over 25,000 for Immigration Violations in One Week
UAE’s ADQ and Energy Capital Partners Announce $25 Billion Energy Venture in the U.S.
KSrelief Launches Extensive Ramadan Food Aid Initiative
Ramadan Celebrations Revitalize Historic Jeddah
Makkah Authorities Urge Worshippers to Follow Crowd Management Guidelines
Direct Flights Between Dammam and Damascus Reestablished for Syrian Residents
Saudi Main Index Rises to Close at 11,760 Amid Mixed Market Performance
Moroccan Prime Minister Aziz Akhannouch Visits Prophet's Mosque in Madinah
×